How to Use Your HSA for Retirement

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By Amy Fontinelle | Investopedia

It has become ingrained in us to max out our 401(k) plan or similar workplace defined contribution plan as the best way to save for retirement. This is certainly good advice. However, in recent years, another retirement savings vehicle has come about that might be superior to the 401(k): a health savings account (HSA).

Health savings accounts (HSAs) are tax-advantaged savings accounts designed to help people with high-deductible health plans (HDHPs) pay for out-of-pocket medical expenses. While these accounts have been available since 2004, too few Americans are taking advantage of them. According to a July 2015 report from the Employee Benefit Research Institute (EBRI), about 17 million people had HSA-eligible health insurance plans in 2014, but only 13.8 million of that number had opened an HSA. A February 2017 survey by America’s Health Insurance Plans (AHIP) of its member insurers reported 20.2 million HSA enrollees in 59 HDHP plans in 2016, up from 19.7 million the previous year. These types of health plans are offered by about 43% of employers right now.

Moreover, in a later report the EBRI noted people with HSAs had an average balance of just $2,922 in 2016 – a pittance, considering that the allowable annual contribution in 2016 was $3,350 for those with individual health plans and $6,750 for those with family coverage. In addition, only 6% of HSAs were in investment accounts. EBRI found that virtually no one contributes the maximum, and nearly everyone takes current distributions to pay for medical expenses.

All of this means that consumers who have HSAs, as well as consumers who are eligible for HSAs but haven’t opened one, are missing out on an incredible option for funding their later years. It’s time to start a new trend.

Why Use an HSA for Retirement?

An HSA’s triple tax advantage, which is similar to that of a traditional 401(k) plan or IRA, makes it a top-notch way to save for retirement. According to a recent story in The Wall Street Journal, HSAs are “the most tax-preferred account available,” says Michael Kitces, director of financial planning at Pinnacle Advisory Group Inc. in Columbia, Md. “Using one to save for retirement medical expenses is a better strategy than using retirement accounts.”

What makes an HSA so good? Consider:

  • 1. Your contributions to an HSA can be made via payroll deductions, as well as from your own funds. If the latter, they are tax-deductible, even if you don’t itemize. If they’re made via the former, it puts them on a pre-tax basis, meaning that they reduce your federal and state income tax liability – and they’re not subject to FICA taxes, either. In addition, any contributions your employer makes do not have to be counted as part of your taxable income.
  • 2. Your account balance grows tax-free. Any interest, dividends or capital gains you earn are nontaxable.
  • 3. Withdrawals for qualified medical expenses are tax-free. This is a key way in which an HSA is superior to a traditional 401(k) or IRA as a retirement vehicle: Once you begin to withdraw funds from those plans, you pay income tax on that money, regardless of how the funds are being used. Also better: Unlike a 401(k) or IRA, an HSA does not require the account-holder to begin withdrawing funds at a certain age. They can remain untouched as long as you like, although you may no longer contribute once you reach 65 and are eligible for Medicare.

What’s more, the balance can be carried over from year to year; you are not legally obligated to “use it or lose it,” as with a flexible spending account (FSA). It can move with you to a new job, too. You own the account, not your employer, which means the account is fully portable and goes when and where you do.

 

Who Can Open an HSA?

To qualify for an HSA, you must have a high-deductible health plan and no other health insurance. You are not yet eligible for Medicare, and you can’t be claimed as a dependent on someone else’s tax return.

A major concern consumers have about foregoing a preferred provider organization (PPO) or health maintenance organization (HMO) plan and choosing a high-deductible health plan instead is that they will not be able to afford their medical expenses. In 2018, an HDHP has a deductible of at least $1,350 for self-only coverage and $2,700 for family coverage. Depending on your coverage, in 2018 your annual out-of-pocket expenses could run as high as $6,650 for individual coverage – or $13,300 for family coverage – under an HDHP. This can be one reason these plans are surprisingly popular among affluent families who will benefit from the tax advantages and can afford the risk.

However, according to Fidelity, a lower-deductible plan such as a PPO could be costing you more than $2,000 a year in higher premiums because you’re paying the extra money regardless of the size of your medical expenses that year. With an HDHP, your spending more closely matches your actual healthcare needs. (Of course, if you are in a situation in which you know your healthcare costs are likely to be high – a woman who is pregnant, for instance, or someone with a chronic medical condition – a high deductible may not be the best choice for you.) Also, HDHPs completely cover some preventive care services.

So an HDHP might be more budget-friendly than you think – especially when you consider its advantages for retirement. Let’s take a look at how you could be using the features of an HSA to more easily and more robustly fund your retirement.  (Get up to speed on the basics in Rules for Having a Health Savings Account.)

Max Out Contributions Before Age 65

As mentioned above, your HSA contributions are tax-deductible before you turn 65 and become eligible for Medicare. The contribution limits of $3,450 (self-only coverage) and $6,900 (family coverage) include employer contributions. The contributions limits are adjusted annually for inflation.

If you have an HSA and you’re 55 or older, you can make an extra “catch-up” contribution of $1,000 per year and a spouse who is 55 or older can do the same, provided each of you has his or her own HSA account. Your family’s total annual contribution cannot exceed $8,750.

You can contribute up to the maximum regardless of your income, and your entire contribution is tax-deductible. You can even contribute in years when you have no income. You can also contribute if you’re self-employed.

“Maxing out contributions before age 65 allows you to save for general retirement expenses beyond medical expenses. Although you will not receive the tax exemption, it gives retirees more access to more resources to fund general living expenses,” says Mark Hebner, founder and president, Index Fund Advisors, Inc., in Irvine, Calif. and author of “Index Funds: The 12-Step Recovery Program for Active Investors.”

Don’t Spend Your Contributions

This may sound counterintuitive, but we’re looking at an HSA primarily as an investment tool. Granted, the basic idea behind an HSA is to give people with a high-deductible health plan a tax break to make their out-of-pocket medical expenses more manageable.

But that triple tax advantage means that the best way to use an HSA is to treat it as an investment tool that will improve your financial picture in retirement. And the best way to do that is to never spend your HSA contributions during your working years and pay cash out of pocket for your medical bills. In other words, think of your HSA contributions the same way you think of your contributions to any other retirement account: untouchable until you retire. Remember, the IRS does not require you to take distributions from your HSA in any year, before or during retirement.

If you absolutely must spend some of your contributions before retirement, be sure to spend them on qualified medical expenses. These distributions are not taxable. If you are forced to spend the money on anything else before you’re 65, you will pay a 20% penalty and you will also pay income tax on those funds.

Invest Your Contributions Wisely

The key to maximizing your unspent contributions, of course, is to invest them wisely. Your investment strategy should be similar to the one you’re using for your other retirement assets, such as a 401(k) plan or an IRA. When deciding how to invest your HSA assets, make sure to consider your portfolio as a whole so that your overall diversification strategy and risk profile are where you want them to be

Your employer might make it easy for you to open an HSA with a particular administrator, but the choice of where to put your money is yours. An HSA is not as restrictive as a 401(k); it’s more like an IRA. Since some administrators only let you put your money in a savings account, where you’ll barely earn any interest, make sure to shop around for a plan with high-quality, low-cost investment options, such as Vanguard or Fidelity funds.

How Much Could You End Up With?

Let’s do some simple math to see how handsomely this HSA savings and investment strategy can pay off. We’ll use something close to a best-case scenario and say you’re currently 21, you make the maximum allowable contribution every year to a self-only plan, and you contribute every year until you’re 65. We’ll assume that you invest all your contributions and automatically reinvest all your returns in the stock market, earning an average annual return of 8%, and that your plan has no fees. By retirement, your HSA would have more than $1.2 million.

What about a more conservative estimate? Suppose you’re now 40 years old and you only put in $100 per month until you’re 65, earning an average annual return of 3%. You’d still end up with nearly $45,000 by retirement. Try out an online HSA calculator to play with the numbers for your own situation.

Maximize Your HSA Assets in Retirement

Here are some options for using your accumulated HSA contributions and investment returns in retirement. Remember, distributions for qualified medical expenses are not taxable, so you want to use the money exclusively for those expenses if possible. There are no required minimum distributions, so you can keep the money invested until you need it.

If you do need to use the distributions for another purpose, they will be taxable. However, after age 65, you won’t owe the 20% penalty. Using HSA assets for purposes other than qualified medical expenses is generally less detrimental to your finances once you’ve reached retirement age because you may be in a lower tax bracket if you’ve stopped working, reduced your hours or changed jobs. In this way, an HSA is effectively the same as a 401(k) or any other retirement account, with one key difference: There is no requirement to begin withdrawing the money at age 70½. So you don’t have to worry about saving too much in your HSA and not being able to use it all effectively

Withdrawals: It’s All in the Timing

By waiting as long as possible to spend your HSA assets, you maximize your potential investment returns and give yourself as much money as possible to work with. You’ll also want to consider market fluctuations when taking distributions, the same way you would when taking distributions from any investment account. You obviously want to avoid selling investments at a loss to pay for medical expenses.

Choose a Beneficiary

When you open your HSA, you will be asked to designate a beneficiary to whom any funds still in the account should go upon your death. The best person to choose is your spouse because he or she can inherit the balance tax-free. (As with any investment with a beneficiary, however, you should revisit your designations from time to time because death, divorce or other life changes may alter your choices.) Anyone else you leave your HSA to will be subject to tax on the plan’s fair market value when they inherit it. Your plan administrator will have a designation-of-beneficiary form you can fill out to formalize your choice.

Pay Health Expenses in Retirement

Fidelity Investments’ most recent Retirement Health Care Cost survey calculates that the cost of healthcare throughout retirement for a couple where the spouses are both 65 years old is $275,000. That’s up $15,000 over 2016. Funds captured in an HSA can help out with such skyrocketing costs.

Qualified payments for which tax-free HSA withdrawals can be made include:

  • Office-visit co-payments
  • Health insurance deductibles
  • Dental expenses
  • Vision care (eye exams, eyeglasses)
  • Prescription drugs and insulin
  • Medicare premiums
  • A portion of the premiums for a tax-qualified long-term care insurance policy
  • Hearing aids
  • Hospital and physical therapy bills
  • Wheelchairs and walkers
  • X-rays

You can also use your HSA balance to pay for in-home nursing care, retirement community fees for lifetime care, long-term care services, nursing home fees, and meals and lodging that are necessary while obtaining medical care away from home. You can even use your HSA for modifications that make your home easier to use as you age, such as ramps, grab bars and handrails. One strategy might be to bunch qualified medical costs into a single year and tap the HSA for tax-free funds to pay them, vs. withdrawing from other retirement accounts that would trigger taxable income.

“Using HSA money to pay for medical expenses and long-term care insurance in retirement is a great benefit for investors given the tax exemption on any withdrawals made to fund either. In other words, it’s the most cost-effective way to fund those expenses because they provide investors the highest after-tax value,” says Hebner. Also, note that there are limitations on how much you can pay tax-free for long-term care insurance based on your age. Click here for more information.

Reimburse Yourself for Earlier Expenses

An HSA doesn’t require you to take a distribution to reimburse yourself in the same year your incur a particular medical expense.The key limitation is that you can’t use an HSA balance to reimburse yourself for medical expenses you incurred before you established the account. So keep your receipts for all healthcare expenses you pay out of pocket after you establish your HSA. If, in your later years, you find yourself with more money in your HSA than you know what to do with, you can use your HSA balance to reimburse yourself for those earlier expenses.

Caveats

The strategies described in this article are based on federal tax law. Most states follow federal tax law when it comes to HSAs, but yours may not. At the time of writing, Alabama, California and New Jersey tax HSA contributions, and New Hampshire and Tennessee tax HSA earnings. Even if you live in a state that taxes HSAs, however, you’ll still get the federal tax benefits. In some states, bills have been presented, but not passed, to change tax law to match the federal treatment of HSAs. The taxation of these plans could change in the future at either the state or federal levels. The plans could even be eliminated altogether, but if that happens, we would likely see them grandfathered for existing account holders, as was the case with Archer MSAs.

The Bottom Line

A health savings account, available to consumers who choose a high-deductible health plan, has been largely overlooked as an investment tool, but with its triple tax advantage, it provides an excellent way to save, invest and take distributions without paying taxes. The next time you’re choosing a health insurance plan, take a closer look at whether a high deductible health plan might work for you. If so, open an HSA and start contributing as soon as you’re eligible. Through maximizing your contributions, investing them and leaving the balance untouched until retirement, you’ll generate a significant addition to your other retirement options.

Of course, you mustn’t let the savings tail wag the medical dog. Hoarding your HSA monies rather than attending to your health is not recommended. However, if you’re financially able to use post-tax dollars for your current healthcare costs while saving your pre-tax HSA dollars for later, you’ll probably be glad you did.

Original Source: http://bit.ly/2GJSPGX

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Rethinking retirement in Mexico

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By Frank O’Brien | Business Vancouver

Ron Rishagen was born in Trail 74 years ago, but he will be spending most of his retirement days near Puerto Escondido on the southwest coast of Mexico, one of many British Columbians who have discovered the luxury destination of Vivo Resorts.

“It’s a winner,” says Rishagen, a retired university professor who, after checking out numerous options, bought a condominium at Vivo Resorts last November.

Over the last decade, the number of Canadians living in Mexico soared from 6,000 to 75,000, according to the Canadian Embassy in Mexico City.

A key reason is the discovery that Mexico has eased its century-old regulation on foreigners owning real estate.

Vivo Resorts is being developed by Calgary-based Cary Mullen, best known as the World Cup champion and two-time Olympic downhill skier. The resort’s success hinges on three facts: the 76 acres of land is owned outright by Canadians; it fronts 21 kilometres of pristine oceanfront beach; and prices for the luxury condominiums and villas are bargain-basement when compared with B.C. waterfront.

In the retirement destination of Victoria, for example, a waterfront home price averages $793,000. At Vivo Resorts, ocean-facing condos start at less than $330,000.

The resort’s homes can also be rented when not in use, with 70 per cent of net proceeds going to the owner.

Mullen discovered that some myths about Mexican land ownership were just that.

For instance, Mexico’s 100-year-old regulations covering foreign ownership within 50 kilometres of a coastline have been relaxed, though using a “fideicomiso” (bank trust) is still required. Even so, there’s a lot of old thought and misinformation around what can and can’t be done, he says.

 “When I first started researching I believed the rumours rather than knowing the facts,” says Mullen. “I spent thousands of dollars with lawyers in Mexico learning about the specific steps and process.”

Some of the rumours Mullen refers to were that developers had to have property held by a Mexican bank trust and that they had to have Mexican partners.

“I learned that you could also have the trust be through some international banks such as HSBC or Scotiabank,” Mullen explains. “I learned the government had changed that rule [about partners] and a Mexican company can be owned 100 per cent by a foreigner.

“A Canadian can now own Mexican property outright,” he says.

The result has been a residential sales performance that would have most Canadian developers drooling.

Since Vivo Resorts opened five years ago near the surfing community of Puerto Escondido, it has built and sold out seven condominium towers with a total of 100 units, plus 10 private detached villas. An eighth condo tower is 75 per cent sold. A ninth tower, Marino Residences, pre-sold half its 28 condos in five weeks last year.

About 45 per cent of buyers are from either B.C. or Alberta.

Even though prices have increased at least 40 per cent since 2012, buyers can purchase a waterfront condominium at Vivo Resorts for an average of $469,000. One-bedroom suites in the newest tower start at $327,400 – and this includes all furnishings, from the giant-screen TV to the dishes and cutlery and maid service. A new two-level penthouse with three bedrooms and more than 1,850 square feet is priced at less than $800,000.

A luxury community and fitness centre recently opened at Vivo Resorts as did marketing for its Botanica condominiums, set back from the beach, but with larger pools and the lowest prices in the resort.

Original Source: http://bit.ly/2GGKRhF

Olivia Cole, Award-Winning ‘Roots’ Actress, Is Dead at 75 in San Miguel Allende, Guanajuato, Mexico

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By CHRISTINA CARON | The New York Times

Olivia Cole, an actress best known for her Emmy Award-winning role in the acclaimed mini-series “Roots,” died on Jan. 19 at her home in San Miguel de Allende, Mexico. She was 75.

The cause was a heart attack, said Linda Cooper, the executive secretary of the cremation and burial association that is handling Ms. Cole’s remains.

In 1977, Ms. Cole won a supporting-actress Emmy for her portrayal of Matilda, the wife of Chicken George (Ben Vereen), in “Roots,” the eight-episode ABC mini-series based on the Pulitzer Prize-winning 1976 book by Alex Haley. The series followed his ancestors’ journey from West Africa to the United States as slaves, and many generations beyond.

More than 28 million viewers watched the first episode, and by the time the finale arrived more than 100 million people had tuned in, breaking ratings records. That year, The New York Times reported, “people everywhere, even those who had not seen it, were talking about ‘Roots.’ ”

“I thought ‘Roots’ would be a boon to all black actors and actresses,” Ms. Cole told United Press International in 1977. “But that didn’t prove to be the case. At least my telephone didn’t start ringing off the hook afterwards. And I don’t think it helped many others.”

If “Roots” did not make Ms. Cole a star, she nonetheless continued to work for decades. She had roles in the mini-series “Backstairs at the White House,” which earned her an Emmy nomination; another mini-series, “The Women of Brewster Place,” produced by and starring Oprah Winfrey; the movie “First Sunday,” starring Tracy Morgan; and numerous theater productions.

“Backstairs,” seen on NBC in 1979, was a behind-the-scenes look at the White House as told by the people who worked there, based on a best-selling memoir. Ms. Cole played the role of the first black maid to be employed on “the presidential floor.”

“The wonderful thing about ‘Backstairs’ is that it offers a challenging role for an actress, not a black actress,” Ms. Cole told The Philadelphia Inquirer in 1979. “If only people would stop thinking in terms of black and white, and think only of who’s the best in terms of ability!”

In 2016 Ms. Cole appeared in a production of the 1995 play “Having Our Say: The Delany Sisters’ First 100 Years” at the Long Wharf Theater and Hartford Stage in Connecticut. The play, written by Emily Mann and based on the book of the same name, explored the bond between two elderly sisters who grew up in the Jim Crow era. Ms. Cole played Sadie Delany, who became a high school teacher; Brenda Pressley played Bessie Delany, who became a dentist.

“This is the sort of theater that feeds you,” Ms. Cole told The Harford Courant at the time.

Ms. Pressley, who had known Ms. Cole since the 1990s, described her in a phone interview as eccentric, spiritual and devoted to her craft.

Original Source: http://nyti.ms/2FcIJga

2018 Mexico Immigration Guide Published

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By Mexperince

The Mexico Immigration Guide has been fully revised and updated for 2018.

The new edition includes updated application fees and economic qualification criteria for different visa types, as well as various enhancements we added by listening to our readers’ feedback over the last year.

Mexico enacted root-and-branch changes to its immigration law in November 2012, the rules of which affect people planning to reside in Mexico—temporarily or permanently.  This latest edition of the Mexico Immigration Guide encompasses the current immigration rules (as well as minor amendments that were enacted since 2012) and also provides practical advice based on real-life experiences of applying for and obtaining residency status in Mexico.

This fully revised and updated edition provides you with a road map that carefully spells-out the various ways that you can legally reside in Mexico, and how to go about obtaining the visa you need, whether you plan to live, work, retire or start a business here.

Original Source: http://bit.ly/2ocTkSW

Want to Retire in Mexico but Not Sure How Much Money You’ll Need? This Might Help

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By: Q-ROO Paul | Two expats Mexico

One of the ways to know if you’ll have enough money to live in a particular country is to look at the average salaries in that country.

It’s a simple economic truth that if the salaries are lower across the board, the cost of living will be lower too. It also stands to reason that if your monthly retirement benefit is similar or even higher than the average salary for many professions, you’ll be just fine.

I created a list showing the median monthly income for 15 randomly selected occupations in Mexico. The data was obtained from misalario.org, a non-profit organization that provides information to both workers and employers in Mexico concerning salaries, labor law and careers.

Median Salaries

Mexico is a large country, so just like in the United States, salaries can vary quite a bit from area to area.

The chart below reflects the nationwide median salaries for someone with 10 years of experience in the listed position.

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Data collected from misalario.org on 01/22/18. Exchange rate used 18.6

Whenever I include salary data from Mexico in one of my articles, the salary that surprises people — especially Americans — is the one for doctors. In this case, I chose a gynecologist, but the salary range is similar for most doctors, regardless of their specialty.

Just to be clear, these are only the median salaries for the positions. In the case of the gynecologist, the top end of the pay scale is $42,559 pesos a month, or about $2,288 USD.

Let’s Wrap This Up

Although this salary study is useful to demonstrate that the cost of living is much lower in Mexico, how much money you will actually need in retirement depends on three factors: 1) where you want to live, 2) the lifestyle that you want, and 3) how much debt you have.

In our case, we sold everything to eliminate all of our debt and used the money that was left over to buy a condo outright in the Riviera Maya. We live debt free for the first time in our lives and our quality of life is superior to what it was back in the States when we were both working.

Original Source: http://bit.ly/2Bv95I0

How to Retire in 2018

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By Emily Brandon | U.S. News

The year you retire is a pivotal time to make final adjustments to your finances and a plan to spend down your assets. You also need to make important decisions about Social Security and health insurance. Here’s what you need to do if you plan to retire in 2018.

Set up health insurance. You don’t want to have any health insurance gaps when you retire. You can sign up for Medicare beginning three months before your 65th birthday, and coverage can start the month you turn 65. If you plan to retire before age 65, remember to enroll in a plan through your state’s health insurance exchange or purchase health insurance through another source. “Individual health insurance policies are pretty expensive, and the premiums are an expense that is coming out of your pocket if you don’t qualify for Medicare just yet,” says Rianka Dorsainvil, founder and president of Your Greatest Contribution in Lanham, Maryland. “You want to understand how much that is and add that as a line item in your budget.”

Decide when to claim Social Security. You don’t necessarily need to claim Social Security in the year you retire. Determine how much your monthly payments will decline if you start benefits before your full retirement age. There’s also an opportunity to increase your monthly Social Security payments if you delay claiming between ages 66 and 70. “Getting an 8 percent increase on your Social Security benefit without really taking any risk is a good return,” says Danny Michael, principal and founder of Satori Wealth Management in Los Angeles. “There are a lot of people who may not be getting 8 percent in their portfolio.” You can get a personalized estimate of your Social Security benefit at various sign up ages at ssa.gov/myaccount.

Tally your income. In addition to your Social Security benefit, calculate how much income you will receive from pensions, retirement account withdrawals and other income sources. “If you plan to retire this year or even within the next couple of months, you have to figure out your income,” Dorsainvil says. “Look at your various income sources, whether that is a pension, a 401(k) or 403(b) and also Social Security.”

Create a spending plan. Take a close look at your current expenses, and which costs might change in retirement. Compare your expenses to the cash flow you expect to have in retirement. “In the months leading up to retirement, think about what you are going to need to replace your paycheck and where that is going to come from,” says Eric Nelson, a chartered financial analyst and managing principal at Servo Wealth Management in Oklahoma City, Oklahoma. “Some of that is going to come from Social Security, you might have a pension, but the rest of that is going to come from your investment portfolio. How much of that nest egg are you going to have to take out on an ongoing basis, and are you going to be able to do that?” Some people need to take steps to boost their retirement income by working a year or two longer or taking on a part-time job in retirement. You can also reduce your monthly costs by downsizing to a less expensive house or apartment or eliminating conveniences you paid for while working that you won’t need in retirement.

Roll over your 401(k). Decide whether you want to roll over your 401(k) balance to an IRA upon retirement. An IRA maintains the tax benefits of a 401(k) plan, but gives you more investment options and allows you to consolidate multiple 401(k) accounts into a single IRA. “If you have 10 different accounts, it’s a nightmare to try to start pulling from all these different places,” Nelson says. “Start to develop a plan for consolidation.”

Adjust your investment portfolio. You might find that you have less appetite for investment risks as you enter retirement and begin to take withdrawals from your retirement savings for living expenses. Many retirees sleep better at night if they keep enough cash to cover several year’s worth of living expenses in safe investments. “Maybe you don’t have the same willingness to ride out stock market declines as when you were working,” Nelson says. “Have at least two years of your income set aside in short-term bonds or cash.”

Look for lower fees. When you are making changes to your investment portfolio, look for low expense ratios on the funds you select. “High fees eat away at your performance,” Michael says. “Look at passive vehicles and exchange-traded funds that keep your fees low.”

Strategize to minimize taxes. Your retirement tax rate will vary based on the type of accounts you take withdrawals from in retirement. Traditional 401(k) and IRA withdrawals are taxed as ordinary income, while Roth distributions in retirement are often tax free. Investments that generate long-term capital gains are generally taxed at a lower rate than ordinary income. “If you have an IRA and a taxable account, you want to put the stocks in your taxable account to take advantage of the preferable tax rates on stocks in your taxable accounts,” Nelson says. Retirees who maintain all three types of accounts will have some control over which accounts to draw from each year and how much tax they will owe.

Plan your new lifestyle. While it’s important to get your finances in order in the year you retire, make a little time to dream about how you will spend your days. Retirement provides opportunities to relax, travel and volunteer in your community, but retirement can also be socially isolating if you don’t make plans to join an organization or meet up with friends. “You are used to going into work Monday though Friday, and sometimes people retire and have absolutely nothing to do,” Dorsainvil says. “This is the perfect opportunity to start looking up classes that will get you out of the house for a few hours a day to learn a new skill or to go on that vacation that you always wanted to take. Now your time is your own.”

Original Source: http://bit.ly/2DlLL10

GETTING UP OFF THE COUCH AND EXERCISING After Retirement in Mexico

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By Terry L Turrell | Retirement before the age of 59

Retirement in México is bliss. The weather where we live is perfect all winter and spring, really most of the year. We throw the doors and windows open each morning and…get lazy. Jon settles onto the couch, reading a western novel and doesn’t move for hours. I sit down at my desk to write until I realize hours have gone by and my Fitbit is nagging me to get moving.   

We walk a lot more in México than we did in the U.S. Every other day we walk at a good clip to town for dinner, and then we kind of stroll home after sharing a small garden salad and shrimp Alfredo, one order of flan, and each drinking two Margaritas. Our bathroom scale tells on us when we have been too lazy and eating too well the day before, reporting that our weight went up two pounds from that delicious dinner the previous night. I guess walking to and from dinner isn’t enough.

We realized pretty quickly after retiring that we had to make ourselves get more exercise or we would turn into blimps, living the good life here in México. So, we started attending yoga classes. We put two exercise classes per week on our calendar as a minimum and then shoot for attending a third. That has helped a lot! If it’s on our calendar, we make it happen. We enjoy yoga with Jim Gallas in the Don Pedro palapa, a beautiful setting overlooking the ocean. Walking a mile each way to the class, uphill both ways, of course, gives us an extra workout. For variation, we have attended yoga classes at Hotelito Los Sueños and at Heart Shala Yoga Studio, both a pleasure. We find that yoga classes help us stay physically stronger and more flexible, as well as improving our mental health.

But what about aerobic exercise? Those of you who know me or have read my previous books and blogs know how hooked I am on Zumba® Fitness classes, a great cardio workout that is based on dance, making it so much fun you forget you’re exercising. (Sounds a bit like an ad, but it’s true!) Sometimes we couldn’t find a Zumba class in Sayulita, so Jon suggested I take the training to become a Zumba instructor. At first, I didn’t think I could do it, but he continued to encourage me, so I enrolled in my first Zumba training class over a year ago. I’m so glad I did. Now I teach Zumba classes two days per week, which Jon faithfully attends with me. When I’m the instructor, there’s no skipping classes. Plus, I have to give it more energy when I know my students are following my example. That has really helped Jon and me stay fit. I have included a short clip of a video from one of my Zumba classes.

Then one day, the Sayulita ejido threw a monkey wrench into our Zumba class schedule. The ejido (community) owned the Casa de la Cultura (House of Culture) where I held my Zumba classes and we paid a small fee to use the space. Without warning, a representative came in at the end of my Wednesday class and informed us that the building had been sold and we could no longer hold classes there.

I wasn’t going to let this glitch put a stop to our fun Zumba classes! I was in a panic for a few days, trying to find a space large enough for eight to twelve of us to dance, with a floor that was either wood or tile, and available around 9:00 in the morning when my students like to have class. Jon and I walked all over Sayulita for several days looking at yoga studios, the Amigo de Corazon Senior Citizen Club, the elementary school, a church, and several hotels. Whew, did we rack up the miles on our Fitbits! I had one of my best Fitbit reports ever. I lost those two pesky pounds, too.

Finally, after researching seven possible sites, we held a trial class at two of the yoga studios and put in a request for permission to have our classes at the Amigo de Corazon Senior Citizen Club. I decided to put my Zumba class on hold until the right room became available. Jon and I began having our own private Zumba class on our patio, just the two of us. We decided whether it was a week or a month before the right space and time slot became available, we would wait to start offering Zumba classes again (hopefully soon). For the time being, we are still getting our aerobic exercise with Zumba twice a week, just at home.

Jon got some unplanned bicycling exercise one week recently. Another flat tire on our golf cart (we nicknamed Carlos), this one from a nail we picked up, required a trip with the tire to the llantería (tire repair shop). I suggested he call a taxi to take him the four miles round trip, but he decided he could strap the tire on the back of his bike, ride to the tire repair shop, wait to have it fixed, and then ride home with it.

Whenever Carlos is out of commission, we end up riding our bicycles on bumpy cobblestone roads to town to buy groceries and take laundry to the lavandería, a somewhat treacherous means of getting exercise. We were both happy Jon was able to get Carlos going again in one afternoon. The cost was 100 pesos ($5 US). We not only get extra exercise living in México, we save money on repairs.

One of the reasons we chose to live in Sayulita is the abundance of exercise opportunities. Living in a beach town, we enjoy boogie-boarding and Stand Up Paddle boarding in the warm weather and temperate ocean water year around. Golf is something we like occasionally, but we aren’t willing to pay the high prices most golf courses charge, so we find the public 9-hole Field of Dreams (Campo de Ensueños) Golf Club in El Monteón to be a lot of fun and inexpensive.

All of this physical fitness makes us thirsty at the end of the day. Just writing about all of this exercise makes me realize it’s time for a margarita or a glass of wine. Which one of the 120 restaurants in Sayulita shall we walk to tonight? Maybe one on the beach with a view of the sunset. So many decisions, so much to do… glad we retired while we are young enough to enjoy all of them.

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